Surging equity markets have helped push oil prices through the $80 level. Benchmark crude oil scheduled for November delivery trades at $83.14 in early New York Mercantile Exchange trade Tuesday (October 19) morning.

Oil prices climbed firmly, by $1.83, in Monday’s trade, for a New York settle price of $83.08. Higher stock prices due to a promising round of earnings reports, along with a weaker dollar-euro ratio were seen as catalysts for the fast start to the week.

Oil could take a hit on Tuesday as pre-market trade suggests a poor start for equities. Apple and IBM posted less glowing earnings, which provided the latest reality check for investors anxious for clear signs of economic recovery in the US.

The euro broke through $1.40 again in overnight European currency speculation, but quickly pulled back to a current rate of $1.3863.

American consumers and businesses have been paying higher prices at the pumps thanks to upward movement in oil prices. The Energy Department’s Energy Information Administration reported overnight (Monday) national average gas prices of $2.834 per gallon of regular unleaded gasoline.

Gas prices have been generally higher during the first half of October and currently sit 26 cents higher than fuel prices from the same time one year ago.

Some drivers are finding more affordable gas prices depending on the part of the country they live in. The report cited prices in major cities that range from $2.63 to $3.17. The highest price points are in the San Francisco area, with Houston at the low end.

Drivers in some parts of the Midwest, including Des Moines, can also find fuel rates in the $2.60s Tuesday.

Better than expected data on new housing starts in Tuesday’s pre-market may offer a catalyst to revive stocks as Tuesday’s trade evolves. This could offer a boost to oil prices, which may help propel crude toward the high-$80s. Additional positive signs of recovery combined with ongoing dollar weakness bodes well oil.

Neil Kokemuller

LiveCharts.co.uk

Neil Kokemuller is an Associate Professor of Marketing at Des Moines Area Community College in Des Moines, Iowa, USA. He has a MBA from Iowa State University. He is also in house stock market commentator at Live Charts UK, where you can find real time charts and share prices .

Please note: The information provided in this article is intended for informational and entertainment purposes, and not as advice for financial decisions or investments. Actions taken on the basis of the information shared is at the sole risk and discretion of the individual. Currency investment poses significant risk of loss.

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